Einhorn Presses His Case Against Apple

2/21/2013 4:23PM

David Einhorn detailed his plan for Apple to return more cash to shareholders, in an attempt to rally its shareholders to support his plan for the company to issue a new type of preferred stock. Telis Demos reports on The News Hub. Photo: Reuters.

This transcript has been automatically generated and may not be 100% accurate.

... the the ... activist shareholder David Einhorn has stepped up its campaign to ... hold this view mall eight hundred and thirty seven billion dollars cash wallets ... moments guy held a conference call will tell you about that and so much mall right here right now on the New Saab good afternoon and welcome I'm Simon Constable ... The will Street gentle to tell us the most was listening in on the common school to many of the cells and is on the sets ... watch this ... thank you very much for being sure of how to walk ... depending on what ... was ... so ... David Einhorn ... basically come stepped up the PR effort in limited duty began a couple weeks ago ... it is a big planned trying get Apple to return more cash to shareholders he presented this idea ... but ... did Apple issuing preferred stock to pay a dividend ... now he's reigned in it he's calling it I crafts trying to my I phone is actually a try to go to the pool or or or release CapRock them you know by presenting it as something as innovative as the products they make ... aam you know arguing that although ... it's not typical way for companies to return cash ... to its a great innovative new idea called thinking God said you know calling I press I think this is sort of clever way of tying ... it to keep the position of what was the code on the call to the sound compelling to you I mean is is is there a time when the sun is the great salesman ... he is a very thorough very precise theory academic salesman he breaks you down by basically going line by line in saying ... you know ... he's the man finance here's the math on that this can save money this in a statement this go read this book reads this will create value ... you might think this would actually that's the city's Nike doesn't read he's not like a ... tear jerker like like Bill Ackman is you know when talks about some of our what exactly I mean he he he you know he really traumatizing Einhorn is little that morning so was in his approach ... they're they're very very precise very academic that they can be very devastating in a ... topic now what muted three months of that ... so I think that what what what relieved that the meat of this call ... was the key address the concern that other people have been what why does Apple just do these other thing it's wise to keep doing what it's doing watching the adopt a new war plan because remember this preferred stock plan did did did I know ... isn't it ... he's come tied it into ... this other issue which is that Apple has has proposed eliminating its ability ... to issue preferred stock without shareholder approval ... anti sealing them on the basis that they should be able to do this initiative the Bible and other chair of the reforms of the PropCo stance so to he's really invested in his preferred stock idea not just the way to return cash ... but also some ... other way Newtek apple by presenting discovered to shoot market now on let's let's go through some of the commentating it's not just a war chest he says it was just a question of what the war will ... be seized ... by any standards of any new was amount of cash hundred and thirty seven billion dollars ... he also pointed to Dow ... as a company that didn't disturb its cash and the share price did baffling is that his nap ... pod of a compelling case ... I would see the most compelling protocols when Einhorn really went through ... an talks and not just Apple but what all tech companies have a strategy tried to thwart cash ... tricky their balance sheets you know very liquid ... is even starting the past when ... no one to come when Apple for example is having its promise the nineties ... they can get money from Wall Street and the Micra soft Einhorned says ... to get money Apple is still scarred by this experience in Sorel of other tech companies the war either just one ... cycle away from being ... you know from from from the New Zealander the I pod you know to to being totally inseparable business coming let let's look at right I mean you can be of the sun sun and huge amount to nothing in the space of a normal Korea ... I mean a probably not want to be scant well what what anyone says that in fact they don't need as much cash as they got the times are different that these are bigger business is that they can use more flexibility in their balance sheets ... so with the saying is that it's time for Apple to sit on ... his point of all was that they didn't just have a cushion ... they had ... a mountain of capsule and fluffy pillow for a walk through its right boy it was was it was a beanbag chair and a baby just floating in money much more than a me and so he thinks that they can be much more aggressive about returning the show was and still have plenty of money ... to keep in it it's to keep his a renewed a ... bright spot ... when entrepreneur much to tell us the ice on the read mall man on WSJ the prom